Ever since news broke that self made billionaire David Murdock was selling his private Hawaiian island of Lanai, there has been a lot of speculation as to who the new owner would be. There were talks that a serious buyer was lined up, but no one would disclose who it was. Many believed it was either Larry Ellison, who regulary vacations on the island, or Bill Gates, who married his wife there. It turns out that one of the rumors was true: Oracle CEO Larry Ellison reached a deal to buy the island of Lanai from Murdock’s Castle and Cooke Inc.
Neither party has given a sales price, but as we reported before, the asking price was estimated at over $500 million dollars. Both parties agreed not to share the information because it includes personal financial information that could competitively hurt Ellison and Murdock if publicly disclosed.
As part of the deal, David Murdock will keep his home on the island and the right to build a wind farm, a project that has drawn the ire of the island’s residents. The windfarm would place windmills on approximately 20 square miles of the island, and supply power to the islnd of Oahu via an oceanic cable. Residents want to see Lanai as a self-sufficient entity not simply a power plant for another more “touristy” island.
Ellison founded Oracle in 1977 and is listed as the sixth richest man in the world by Forbes Magazine. He has an estimated net worth of $36 billion, and plans to pay cash to acquire the island.
Right now the deal has not reached completion pending Hawaiian utilities commission approval of the transfer of the islands water, bus and shuttle service, and waste water treatment facilities. Castle and Cook has requested this meet approval by June 26 and the commission has stated that they will make their best efforts to have it finished by that time. Expect the sale to close shortly thereafter.
Lanai was once owned by James Dole of Dole Food Company Inc, and was subsequently given the name “pineapple island”. Murdock shut down pineapple production when he purchased the island in 2000 to make way for residential homes and a luxury resort.
Island residents are hopeful that the Ellison purchase will bring more jobs to help alleviate the high unemployment rate. Many hope that he will bring the island closer to sustainability, without resting solely on the tourism industry, which has been in decline.
[source: AP]